The German Federal Financial Supervision Authority (Bafin) has rejected the Ethena Labs application to refer to Tokens for Assets under the European Union market in Crypto-Assets Regulation (MICAR).
The regulator has also expressed concern that the Susde can form a security offer without a permit.
According to Bafin’s officialThe application submitted by Ethena GmbH, an entity based in Frankfurt under the business structure of Ethena Labs, showed “significant shortcomings” in organizational practices and could not meet the Micar requirements with regard to asset reserves and capital-needness.
Bafin immediately imposed enforceable supervisory measures, including the prohibition of further public offers from the Usde -token in Germany, and ordered the preservators to freeze the reserve activa of the token.
In particular, some Stablecoin spending under the MICA regulation has experienced problems. Large European exchanges quit Tether USD (USDT) because they were worried that the token could be non-compliant. However, authorities are not yet as a USDT non-conformed.
Ordered to stop using
According to a micar transition determination, however, Ethena GmbH continued to publish token in Germany after an application for authorization on July 29, 2024.
About 5.4 billion Usde -Tokens are currently circulating, most of which are spent before the effective enforcement of Micar and outside Germany.
Bafin clarified that her actions have no influence on the secondary market trade of Usde, but temporarily limit the repayments directly via Ethena GmbH. Since January 2025, Ethena BVI Limited, an affiliated entity has been established in the British Virgin Islands, also facilitates the issue of the token.
In addition, the supervisor has appointed a special representative to check compliance and noted the potential for additional promotions, including a ban on public offers of associated effects.
Supporters
In addition to operational shortcomings, Bafin expressed a “sufficiently substantiated suspicion” that the Susde -token is eligible if a safety has been offered under German law and publicly without an approved prospectus of securities.
The Susde is a revenue -bearing stablecoin that is obtained by putting the Usde. The concern of Bafin stems from the financial structure and alleged profit promise embedded in the Susde -that the classification of regulations can cause safety.
The position of Bafin introduces a regulatory challenge for hybrid instruments such as Susde, which combine Stablecoin mechanics with characteristics of yield generation. The supervisor actively evaluates whether the public distribution of such instruments requires compliance with securities legislation, including disclosure and prospectus obligations.
The outcome of this classification could be a precedent for comparable crypto assets in the European Union.
The response of Ethena Labs
In response, Ethena Labs published one rack confirming that it was informed about Bafin’s decision to reject the Micar application from Ethena GmbH.
The company acknowledged the decision in a public statement and said that the “alternative frameworks evaluates” for compliance with the regulations.
Ethena Added:
“Since its foundation, Ethena has investigated various options and jurisdictions when it comes to legal frameworks worldwide. Micarautorization via Ethena GmbH was one of the different options we have pursued.”
The company emphasized that the decision does not affect the usde -minting and repayment activities that are facilitated by Ethena BVI Limited, which serves the “vast majority” of users.
The company also denied the speculation of a freezing of an assets and claimed that all reserves remain available. It added that it intends to revise his service conditions in the coming week.
The rejection of Bafin reinforces the increasing control of stablecoins and synthetic yield instruments that operate within or focuses on European markets after the implementation of MICA.
